Security Agreement
(All
Assets)
This Security Agreement (the “Security
Agreement”) is made between inContact, Inc.
(“Borrower”), a Delaware corporation, and Zions First
National Bank (“Lender”), pursuant to a Loan Agreement
dated July 16, 2009, between Borrower and Lender (the “Loan
Agreement”).
For good and valuable consideration, receipt of
which is hereby acknowledged, Borrower and Lender hereby agree as
follows:
1.
Definitions . Except as otherwise provided herein, terms
defined in the Loan Agreement shall have the same meanings when
used herein. Terms defined in the singular shall have the same
meaning when used in the plural and vice versa. Terms defined in
the Uniform Commercial Code which are used herein shall have the
meanings set forth in the Uniform Commercial Code, except as
expressly defined otherwise. As used herein, the term:
“Collateral” means the collateral
described in Section 2, Grant of Security Interest ,
below.
“Default Rate” means the default
interest rate provided in the Promissory Note.
“Liquidation Costs” means the
reasonable costs and out of pocket expenses incurred by Lender in
obtaining possession of any Collateral, in storage and preparation
for sale, lease or other disposition of any Collateral, in the
sale, lease, or other disposition of any or all of the Collateral,
and/or otherwise incurred in foreclosing on any of the Collateral,
including, without limitation, (a) reasonable attorneys fees and
legal expenses, (b) transportation and storage costs, (c)
advertising costs, (d) sale commissions, (e) sales tax and license
fees, (f) costs for improving or repairing any of the Collateral,
and (g) costs for preservation and protection of any of the
Collateral.
“Permitted Encumbrances” means the
following: (a) liens for taxes and assessments not yet due and
payable or, if due and payable, those being contested in good faith
by appropriate proceedings and for which appropriate reserves are
maintained; (b) security interests and liens created by the Loan
Documents; (c) liens arising in the ordinary course of business
(such as liens of carriers, warehousemen, mechanics, materialmen,
and landlords) and other similar liens imposed by law for sums not
yet due and payable or, if due and payable, those being contested
in good faith by appropriate proceedings and for which appropriate
reserves are maintained in accordance with Accounting Standards;
(d) any liens existing on the date of this Security Agreement and
set forth on Schedule A attached hereto; (e) liens (i) upon or in
any equipment acquired or held by Borrower to secure the purchase
price of such equipment or indebtedness (including capital leases)
incurred solely for the purpose of financing the acquisition of
such equipment or (ii) existing on such equipment at the time of
its acquisition, provided that the lien is confined solely to the
equipment so acquired, improvements thereon and the Proceeds of
such equipment; (f) leases or subleases and licenses or sublicenses
granted to others in the ordinary course of Borrower’s
business; (g) any right, title or interest of a licensor under a
license; (h) liens arising from judgments, decrees or attachments
that have been stayed or bonded within fifteen (15) days after
notice thereof; (i) liens in favor of customs and revenue
authorities arising as a
matter
of law to secure payment of customs duties in connection with the
importation of goods; (j) liens arising solely by virtue of any
statutory or common law provision relating to banker’s liens,
rights of setoff or similar rights and remedies as to deposit
accounts or other funds maintained with a creditor depository
institution; (k) liens in favor of a depository bank or a
securities intermediary pursuant to such depository bank’s or
securities intermediary’s customary customer account
agreement; provided that any such liens shall at no time secure any
indebtedness or obligations other than customary fees and charges
payable to such depository bank or securities intermediary; (l)
liens incurred or deposits made to secure the performance of
tenders, bids, leases, statutory or regulatory obligations, surety
and appeal bonds, government contracts, performance and
return-of-money bonds, and other obligations of like nature, in
each case, in the ordinary course of business; (m) liens incurred
or deposits made in the ordinary course of business in connection
with workers’ compensation, unemployment insurance and other
types of social security; (n) liens incurred in connection with the
extension, renewal or refinancing of indebtedness secured by liens
permitted under the preceding clauses, provided that any extension,
renewal or replacement lien shall be limited to the property
encumbered by the existing lien and the principal amount of the
indebtedness being extended, renewed or refinanced does not
increase; (o) other security interests and liens authorized in
writing by Lender; and (p) liens under the Equipment Line; provided
that the aggregate of the outstanding principal balance owing on
any debt and the total outstanding lease payments allowed in
clauses (e) and (n), above, shall not exceed five hundred thousand
dollars ($500,000.00) without the prior consent of
Lender.
“Uniform Commercial Code” means the
Uniform Commercial Code as adopted now or in the future in the
State of Utah.
2.
Grant of
Security Interest . Borrower hereby grants to Lender a security
interest in the following personal property of Borrower, wherever
located, now owned or existing or hereafter acquired or created
(the “Collateral”):
a.
All inventory, all
proceeds and products thereof and all additions and accessions to,
replacements of, insurance or condemnation proceeds of, and
documents covering any of the foregoing, all leases of any of the
foregoing, and all rents, revenues, issues, profits and proceeds
arising from the sale, lease, license, encumbrance, collection, or
any other temporary or permanent disposition of any of the
foregoing or any interest therein (collectively, the
“Inventory”).
b.
All accounts and
all proceeds thereof (collectively, the
“Accounts”).
c.
All equipment and
goods, all motor vehicles, all proceeds and products of the
foregoing and all additions and accessions to, replacements of,
insurance or condemnation proceeds of, and documents covering any
of the foregoing, all leases of any of the foregoing, and all
rents, revenues, issues, profits and proceeds arising from the
sale, lease, license, encumbrance, collection, or any other
temporary or permanent disposition of any of the foregoing or any
interest therein (collectively, the
“Equipment”).
d.
All general
intangibles and all documentation and supporting information
related thereto, all rents, profits and issues thereof, and all
proceeds thereof.
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e.
All of the
following (collectively, the “Financial Obligations
Collateral”):
i. Any
and all promissory notes and instruments payable to or owing to
Borrower or held by Borrower;
ii.
Any and all leases under
which Borrower is the lessor;
iii.
Any and all chattel paper
in favor of, owing to, or held by Borrower, including, without
limitation, any and all conditional sale contracts or other sales
agreements, whether Borrower is the original party or the
assignee;
iv.
Any and all security
agreements, collateral and titles to motor vehicles which secure
any of the foregoing obligations; and
v. All
amendments, modifications, renewals, extensions, replacements,
additions, and accessions to the foregoing and all proceeds
thereof.
f.
All deposit
accounts, including without limitation, all interest, dividends or
distributions accrued or to accrue thereon, whether or not due, and
all proceeds thereof.
g.
All investment
property, all interest, dividends or distributions accrued or to
accrue thereon, whether or not due, and all proceeds
thereof.
h.
All documents, all
amendments, modifications, renewals, extensions, replacements,
additions, and accessions thereto, and all proceeds
thereof.
i.
All
letter-of-credit rights, all amendments, modifications, renewals,
extensions, replacements, additions, and accessions thereto, and
all proceeds thereof.
j.
All supporting
obligations, all amendments, modifications, renewals, extensions,
replacements, additions, and accessions thereto, and all proceeds
thereof.
k.
All of the
following (collectively, “Intellectual
Property”):
i. All
right, title and interest of Borrower in and to patent applications
and patents, including, without limitation, all proceeds thereof
(such as, by way of example, license royalties and proceeds of
infringement suits), the right to sue for past, present and future
infringements, all rights corresponding thereto throughout the
world, and all reissues, divisions, continuations, renewals,
extensions, and continuations-in-part thereof (collectively, the
“Patents”);
ii.
All right, title and
interest of Borrower in and to trademark applications and
trademarks, including, without limitation, all renewals thereof,
all proceeds thereof (such as, by way of example, license royalties
and proceeds of infringement suits), the right to sue for past,
present and future infringements, and all rights corresponding
thereto throughout the world (collectively, the
“Trademarks”), and the good will of the business to
which each of the Trademarks relates;
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iii.
All copyrights of
Borrower and all rights and interests of every kind of Borrower in
copyrights and works protectable by copyright, and all renewals and
extensions thereof, and in and to the copyrights and rights and
interests of every kind or nature in and to all works based upon,
incorporated in, derived from, incorporating or relating to any of
the foregoing or from which any of the foregoing is derived, and
all proceeds thereof (such as, by way of example, license royalties
and proceeds of infringement suits), the right to sue for past,
present and future infringements, and all rights corresponding
thereto throughout the world (collectively, the
“Copyrights”);
iv.
All of Borrower’s
trade secrets and other proprietary information, and all proceeds
thereof (collectively, the “Trade Secrets”);
v. All
right, title, and interest of Borrower in, to and under license
agreements and contracts concerning Patents, Trademarks,
Copyrights, and Trade Secrets, all amendments, modifications, and
replacements thereof, all royalties and other amounts owing
thereunder, and all proceeds thereof (collectively, the
“Licenses”); and
vi. All
internet domain names and addresses of Borrower and all proceeds
thereof.
Borrower and Lender acknowledge their mutual
intent that all security interests contemplated herein are given as
a contemporaneous exchange for new value to Borrower, regardless of
when advances to Borrower are actually made or when the Collateral
is created or acquired.
3.
Debts
Secured . The security interest granted by this Security
Agreement shall secure all of Borrower’s present and future
debts, obligations, and liabilities of whatever nature to Lender,
including, without limitation, (a) the Promissory Note of Borrower
in favor of Lender dated July 16, 2009, in the original principal
amount of eight million five hundred thousand dollars
($8,500,000.00), and all renewals, extensions, modifications and
replacements thereof (including any which increase the original
principal amount), (b) all obligations of Borrower arising from or
relating to the Loan Documents, including, without limitation, this
Security Agreement, (c) advances of the same kind and quality or
relating to this transaction, (d) transactions in which the
documents evidencing the indebtedness refer to this grant of
security interest as providing security therefor, (e) all
overdrafts on any account of Borrower maintained with Lender, now
existing or hereafter arising, and (f) the Equipment
Line.
Borrower and Lender expressly acknowledge their
mutual intent that the security interest created by this Security
Agreement secure any and all present and future debts, obligations,
and liabilities of Borrower to Lender without any limitation
whatsoever.
4.
Location of
Borrower and Collateral . Borrower represents and warrants that
as of the Effective Date:
a.
Borrower is a
corporation organized under the laws of the State of
Delaware.
b.
The complete and
exact name of Borrower is inContact, Inc.
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c.
The organizational
identification number, if any, assigned to Borrower by
Borrower’s state of organization is 3016691.
d.
During the five (5)
years preceding the date of this Security Agreement:
i.
Borrower has not been
known by nor used any legal, fictitious or trade name, except UCN,
Inc. and Buyers United, Inc.;
ii.
Borrower has not changed
its name in any respect, except from UCN, Inc. and Buyers United,
Inc.;
iii. Borrower
has not been the surviving entity of a merger or
consolidation;
iv.
Borrower has not acquired
all or substantially all of the assets of any person or entity,
except as disclosed on Schedule B;
e.
Borrower’s
chief executive office is located at 7730 South Union Park Avenue,
Suite 500, Salt Lake City, Utah 84047.
f.
Borrower’s
place of business is located at 7730 South Union Park Avenue, Suite
500, Salt Lake City, Utah 84047.
g.
The Inventory of
Borrower is kept at the following locations and no others: 7730
South Union Park Avenue, Suite 500, Salt Lake City, Utah
84047.
The Equipment is located in the
States of Utah, California, and Texas, other than temporary (not to
exceed three months) uses outside such states in the ordinary
course of Borrower’s business, will not be removed from such
states without the prior written consent of Lender.
Borrower agrees that it will not
change its state of organization, name, or any of the above
locations or create any new locations for such matters without
giving Lender at least thirty (30) days prior written notice
thereof.
5.
Representations
and Warranties Concerning Collateral . Borrower represents and
warrants that:
a.
Borrower is the
sole owner of the Collateral.
b.
The Collateral is
not subject to any security interest, lien, prior assignment, or
other encumbrance of any nature whatsoever except Permitted
Encumbrances.
c.
The Accounts and
Financial Obligations Collateral, if any, are each a bona fide
obligation of the obligor identified therein for the amount
identified in the records of Borrower, except for normal and
customary disputes which arise in the or
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